Are you asking, “what is my house worth?”. Real estate agents calculate a CMA – a comparative market analysis – to help determine the selling price of a house. To generate a CMA, your agent will compare the house to similar recently sold houses in the area, looking at active, recently sold, and expired listings for houses as similar to yours as possible.
Determining the value of your house is one of the most important skills your agent should possess (along with marketing and closing skills). So let’s see how an agent would calculate a CMA for your house in Cincinnati.
Read below and watch this video from Team Sztanyo as we walk through the actual steps of using the Cincinnati MLS to create a home valuation CMA and help our sellers learn what their house is worth.
1. Neighborhood Assessment
The first thing your agent will usually do to calculate a CMA is to assess the neighborhood. A quick online check of the neighborhood will help an agent get a feel for property values. What he will look at includes:
- Proximity to amenities
- Proximity to unpleasant or unsightly things like garbage dumps
- Major curb appeal issues
2. Zillow or RPR
Next, in order to calculate a CMA for your house in Cincinnati, your agent may check out Zillow’s Zestimates, which are based on limited tax records and agent-added data. Although these may not be entirely accurate, they are nevertheless a good starting point. Often times homeowners will use their Zestimate to contact their agent and say, I’m ready to sell now. Unfortunately, the Zestimate may bring in some other comps that are inflating the sale price.
I use another tool called RPR or Realtor’s Property Resource, which I have found to be much more accurate than a Zillow Zestimate. It grabs better comps and usually doesn’t get tricked by nearby home sales that shouldn’t be used in the formula.
3. Valuation and Value Forecast
Your agent will likely next consult RPR to begin to arrive at a valuation and value forecast. Basically, this is done for the sake of thoroughness – gathering all the available information early on to calculate a CMA accurately further on in the process. One of the good things about RPR is that it offers value forecasts and valuations three years out. This can then be used for negotiating leverage early on.
4. Preliminary CMA with MLS
Once your agent has assessed the neighborhood and looked into the Zillow Zestimate and RPR report valuation, he will check out the MLS with certain in Cincinnati or the Northern KY MLS. He can examine comparable listings – sold, active, expired, and pending – to get a rough idea of your home’s value.
5. Comp Listings and Square Foot Price
After compiling all this information and narrowing the search criteria, your agent will then begin to calculate a CMA for your house in Cincinnati. By this point, he should have pinpointed several homes in the area comparable to yours and can consider the selling prices of those homes. The job at this point is to find the average price per square foot for these comparable homes to arrive at a fairly accurate estimate for the selling price of your home based on square footage.
6. In-person Assessment
The next and last of the preparatory steps to calculate a CMA is is an in-person assessment of your house. Your agent has completed all the preliminary research, so now he needs to see and assess your house in person to see how it stacks up against what he has learned on paper.
Your agent will come and do a walk thru of your property. This is where they can more accurately assess your home and compare its condition to the other comps. Preferably, you’ll want to work with an agent that has been in the other homes or sold homes in your neighborhood. They will have a more accurate read on how your house compares to the comps in the CMA. It’s always helpful to have an outside opinion on this because it’s easy to become biased about “what your house is worth”.
7. Final CMA Preparation
Having done all these things, your agent will then calculate a CMA for your house in Cincinnati. Often this is done in the form of a PowerPoint or keynote presentation, printed out and put together in a binder. Today, most agents rely on CMA software in order to organize the data in an attractive way. In any case, at this point, your agent will have arrived at a final determination of the fair market value of your house.
These, then, are the steps a real estate agent will take to calculate a CMA for your house in Cincinnati. And it takes a good deal of expertise, knowledge, and experience to get it right. And then your agent has to know how to market your house and close the deal. We have the experience and know-how to help you with all aspects of selling your house.